Context of '1996-1998: Monsanto Buys Several Seed Companies'

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Over the span of two decades, Monsanto accumulates approximately 650 plant-related biotech patents, including the patent on the 35S promoter, a genetic mechanism used extensively in the biotech industry. All biotech companies using the promoter must pay Monsanto a technology use fee. By 2004, the company has a 29.82 percent share of all research and development in the biotech industry. [Center for Food Safety, 2005, pp. 13 ]

Monsanto spends $8 billion acquiring, or establishing relationships with, several US and foreign seed companies. [Canadian Business, 10/8/1999; Center for Food Safety, 2005, pp. 9-10 ] The list of companies includes: Calgene, Inc.; Asgrow Agronomics; Asgrow and Stine Seed; Agracetus; Holden’s Foundation Seeds, Inc.; Monsoy (a Brazilian soybean company); Cargill’s international seed divisions (with operations in Asia, Africa, Europe, and Central and South America); Plant Breeding International; and DeKalb Genetics (the world’s second largest seed company). Pioneer Hi-Bred is the only major US seed company that Monsanto does not buy out. However, Pioneer has purchased rights from Monsanto to use technology relating to Roundup Ready soybeans and Bt corn. A 2005 report by the Center for Food Safety will say that one of the factors contributing to Monsanto’s cornering of the GM market (see 1998 and later) is its control of these seed companies. “[T]hese companies (often owned or indirectly controlled by Monsanto) had to agree that 90 percent of the sales of herbicide-tolerant soybeans would contain Monsanto’s patented technology. This requirement was later dropped to 70 percent after Monsanto came under scrutiny from government regulators. Through this sort of ownership and control of seed companies, Monsanto has been able to ensure that competition [will] remain small and that its patented genetically engineered crop varieties [will] be the ones most readily available to the American farmer.”
[Center for Food Safety, 2005, pp. 9-10 ]

Monsanto has become the world’s largest supplier of genetically modified seeds and the second largest seller of all seed types. Only Pioneer Hi-Bred, soon to be purchased by Dupont (see March 14, 1999), sells more seeds than Monsanto. Within the US, Monsanto directly or indirectly controls nearly half the corn germplasm market and most of the soybean market. Its dominant position in the market has been attributed to several factors: its two-year buying spree of other seed companies (see 1996-1998), its control of a large percentage of the biotech industry’s plant patents (see 1980s-2004), and the Technology Use Agreement (see 1996) it forces farmers to sign. According to a 2005 report by the Center for Food Safety (CFS), the availability of conventional seeds to farmers worldwide has been dramatically reduced as a result of Monsanto’s control of the market. “For many farmers across the country, it has become difficult if not impossible, to find high quality, conventional varieties of corn, soy, and cotton seed. Making matters worse, the direction of land-grant university research has been shifting away from producing new conventional seed varieties and toward biotech applications,” the report says. Indiana soybean farmer Troy Roush tells the Center, “You can’t even purchase them in this market. They’re not available.” Another farmer interviewed by the organization, a Texan, similarly states, “Just about the only cottonseed you can get these days is [genetically engineered]. Same thing with the corn varieties. There’s not too many seeds available that are not genetically altered in some way.”
[Center for Food Safety, 2005, pp. 9-10 ]

The Foundation on Economic Trends (FOET) files a class-action lawsuit against Monsanto on behalf of a group of Iowa, Indiana, and French farmers. The suit alleges that Monsanto failed to ensure that its genetically modified seeds were safe for consumers and the environment before it brought them to market. It also claims that the company, which has bought out numerous seed companies in recent years (see 1996-1998), seeks to control world production of agriculture and food through the spread of its patented genes. “Through various anti-competitive practices, it seeks to control world production of agriculture and food, with particular concentration on power over seeds,” says Jeremy Rifkin, the foundation’s president. “What this means is that if the companies get their way, no farmer in the world will ever own a seed again. If that doesn’t hold implications for anti-trust law in the world of agriculture, then I don’t know what does.”
[Reuters, 12/15/1999]

St. Louis Federal District Judge Rodney W. Sippel denies class-action status to an antitrust case against Monsanto and other companies (see December 14, 1999) . The suit alleges that the companies conspired to fix prices and control the seed market. [AXcess News, 3/8/2005]

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